ECONOMIC SURVEY - 09-Aug-95

9 August 1995

(COMMUNICATED BY GPO ECONOMICS DESK)

PEACE ECONOMY:

* SIX MULTINATIONAL FIRMS ADVANCE TO FINAL STAGE IN WORLD BANK TENDER FOR DEVELOPING MASTER PLAN FOR JORDAN VALLEY DEVELOPMENT.
Six international firms have advanced to the final stage of the World Bank's tender for developing a master plan for developing the Jordan Valley. The plan will include water, tourism, agriculture, and transportation projects for the valley's development. Firms taking part in consortiums which have reached the final stage of competition are from the U.S., Britain, Italy, Lebanon, Germany, and Belgium. The initial feasibility study on the Jordan Valley regional project was done by Environment and Ecology, an American firm. (Globes, 8.8.95)

* PROGRESS TOWARDS ESTABLISHMENT OF REGIONAL BUSINESS COUNCIL AT MULTILATERAL TALKS.
Progress was made towards the establishment of a Regional Business Council during multilateral trade talks which took place in Cairo on 31.7.95, the Industry and Trade Ministry reported. The talks took place between private and public sector economic organizations from Israel, Egypt, Jordan, and the Palestinian Authority. This was the first official meeting of the economic organizations. Dan Katarivas, director of the Middle East and North African Department in the Industry and Trade Ministry's Foreign Trade Administration, stated that he hopes a working group established to bridge the gaps between the participants will be able to proclaim the establishment of a Regional Business Council at October's Amman Conference.
Industry and Trade Ministry - Dan Katarivas, 972-2-220297

MACRO-ECONOMIC SECTOR:

* FOREIGN RESERVES INCREASE BY $158 MILLION IN JULY.
Israel's foreign reserves increased by $158 million at July end to reach $8.93 billion, the Bank of Israel reported. The Central Bank reported that the rise was the result of the private sector's increasing its foreign currency credit, though at substantially lower levels than during the first five months of the year, and due to increased foreign resident investments in Israel.
Bank of Israel - Ohad Bar-Efrat, 972-2-6552712

* ECONOMIC GROWTH CONTINUES DURING FIRST HALF OF 1995 BANK OF ISRAEL.
Economic growth during the first half of 1995, characterized by a moderation in the Consumer Price Index (inflation), a decrease in unemployment, and an increase in the trade deficit, was reported by the Bank of Israel. Strengthened economic growth during the first six months of the year was also expressed by growth in industrial production, increased industrial input exports, the organized wholesale price index, a majority of the construction industry indices, and an increase in bank loans to the public. The Central Bank reported the current economic growth period began in December 1994.
Bank of Israel - Ohad Bar-Efrat, 972-2-6552712

PRIVATIZATION:

* GOVERNMENT DECIDES TO OFFER 51% OF LAPIDOT OIL PROSPECTORS CORPORATION TO PRIVATE INVESTORS.
The Government has released details of its proposed sale of 51% of Lapidot Oil Prospectors Corporation, the country's largest owner of gas and oil drilling equipment, to private investors. The Finance Ministry announced that those interested in acquiring controlling shares in Lapidot should contact the Government Companies Authority in the Finance Ministry by the end of August 1995. In November 1994, the Government offered 49% of the concern's equity, including warrants, on the Tel Aviv Stock Exchange.
Government Companies Authority - Tamar Ben-David, 972-2-317292

* GOVERNMENT DECIDES TO PRIVATIZE TAHAL (WATER PLANNING FOR ISRAEL).
The Government has decided to privatize 100% of Tahal (Water Planning for Israel), which is involved in providing consulting and engineering services for local and international water development projects. The company, which has projects around the world including in India, Bulgaria, and Mexico, employs over 425 workers, over half of them engineers.
Government Companies Authority - Tamar Ben-David, 972-2-317292

DEFENSE INDUSTRIES SECTOR:

* ISRAEL AIRCRAFT INDUSTRIES CREATES JOINT VENTURE HOLDING COMPANY TO MARKET CIVILIAN TECHNOLOGIES DEVELOPED BY IAI.
On 8.8.95, Israel Aircraft Industries and a group of American and Israeli partners, led by Electronic Associates of New Jersey, USA, signed an agreement to create a holding company for developing civil and commercial products not included in IAI's core businesses. The joint venture's majority will be held by the US-Israeli partnership called EATI whose initial capitalization will be $7.5 million. EATI's partners include: FIBI Holding Company of First International Bank of Israel, Moshe Wertheim of Central Bottling Company, Motti Zisser of Control Centers real estate, Broad Capital of New York, Mark Hauser of Tamarix Capital, and Irwin Gross, chairman of Electronic Associates.
Israel Aircraft Industries - Doron Suslik, 972-3-9358509

FOREIGN TRADE: